Under the collateral assignment, what liability or obligation does Management Recruiters have arising from the assignment of telephone numbers and listings?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
al symbols (collectively, the "Marks"); and
WHEREAS, in order to protect its interest in the Operating System and the Marks, Franchisor desires to have the right to control the telephone numbers and listings of the Franchised Business if the Franchise Agreement is terminated.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows:
1. RECITALS
The foregoing recitals are true and correct in every respect and are incorporated by reference herein.
2. DEFINITION OF TERMS
Terms not otherwise defined in this Assignment shall have the meaning as defined in the Franchise Agreement.
3. COLLATERAL ASSIGNMENT
Franchisee hereby assigns to Franchisor all of Franchisee's right, title and interest in and to those certain telephone numbers and regular, classified or other telephone directory listings (collectively, the "Numbers and Listings") associated with the Marks and used from time-to-time in connection with the operation of the Franchise Business. This Assignment is for collateral purposes only. Franchisor will have no liability or obligation of any kind whatsoever arising from or in connection with this Assignment, unless Franchisor notifies the telephone company and/or the listing agencies with which Franchisee has placed telephone directory listings (collectively, the "Telephone Company") to effectuate the assignment of the Numbers and Listings to Franchisor. Upon termination or expiration of the Franchise Agreement, Franchisor will have the right and authority to ownership of the Numbers and Listings. In such event, Franchisee will have no further right, title or interest in the Numbers and Listings and will remain liable to the Telephone Company for all past-due fees owing to the Telephone Company on or before the date on which the assignment is effective. As between Franchisor and Franchisee, upon termination or expiration of the Franchise Agreement, Franchisor will have the sole right to and interest in the Numbers and Listings.
**4.
Source: Item 23 — RECEIPTS (FDD pages 67–327)
What This Means (2024 FDD)
According to Management Recruiters' 2024 Franchise Disclosure Document, the collateral assignment of telephone numbers and listings specifies the extent of the franchisor's liability. Management Recruiters will not have any liability or obligation related to the assignment of telephone numbers and listings unless they notify the telephone company or listing agencies to effectuate the assignment. This means that as long as Management Recruiters does not take active steps to change the phone numbers and listings, they bear no responsibility.
Upon termination or expiration of the franchise agreement, Management Recruiters gains the right to ownership of the telephone numbers and listings. At that point, the franchisee loses all rights to the numbers and listings but remains responsible for any outstanding fees owed to the telephone company up to the date the assignment becomes effective. This protects Management Recruiters from being responsible for the franchisee's debts.
Furthermore, the franchisee agrees to indemnify Management Recruiters against any losses, liabilities, claims, or expenses arising from the franchisee's breach of any agreement or nonpayment of debts to the telephone company. This indemnification clause ensures that the franchisee is responsible for their own actions and financial obligations related to the telephone services, even after the franchise agreement ends and the phone numbers are assigned to Management Recruiters.